INTERNATIONAL EXPOSURE:
The firm expands its business globally in various regions to develop their business wherein the exposure depends on the size of the firm, country and industry affiliation. The industries are significantly exposed to exchange rate movements and trade by the share of imports and exports. Exports help in increase in the annual revenue by shipping the products from one country to other and when importing the products from other countries the country has to pay the import duty which includes the cost, insurance and freight (CIF) and taxes.
MARUTI SUZUKI:
Maruti Suzuki exports cars to over 125 countries like Africa, china, Asia, Latin America etc because of its product quality and manufacture capability. It has been awarded
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After emerging the Indian market JLR has been expanded into Jaguar F-Type, Jaguar XF, Second and Fourth generation Range Rover, Range Rover Evoque which has a high demand in china where in it is actively exploring in the Indian market. Tata imports these luxury cars because the manufacture price of the cars are higher than the import duties.JLR best selling models are XF and Freelander2 where it sold around 2288 cars in March 2012 .
Tata Motors proposed to cut down the cost of the import duty on cars imported from Europe. In order to hinder the growth of domestic automobile industry the company proposed the liberal policy to India to attract the global players resulting in the growth.
During 2012-13 the sales increased to 372062 units from 314443 units in the fiscal year 2011-12 and the sales raised to 18.3%. Jaguar increased to 7% during the year 2012-13 and Land Rover increased to 20.7% units of sales. And overall JLR increased to 15.8% units of sales in India. Hence the import sales on the luxury cars can be increased further in 2014 .
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It is the leading exporter of passenger cars with the market share of 48% in spite of the economic slowdown in 2012 it exported 250,005 cars across various countries. During May 2013 the export sales accounted to 24,754 units and the growth rose to 4.6% where Hyundai became the second largest passenger car exporter. Hyundai has awarded Golden trophy for top exporter award 2102-13 by EEPC India .
In the challenging market of increase in the demand of the petrol cars Hyundai is expected to maintain the positive growth in gaining the market share in the future years. Hyundai Elantra, Verna are yet been continuing has the market leaders and the demand are strong except the non European countries .
IMPORT:
Hyundai imports majorly from South Korea, North America and china. The two models that are imported are Hyundai sonata, Hyundai Santa Fe third generation that is been manufactured mainly in South Korea. The second generation Santa Fe has been awarded ha the top safety picks by the Insurance Institute for high way safety and has been rated with five stars by ANCAP- Australasian new car assessment program
When considering entry to China piracy was a concern. Thus, HD serves China as an import market rather that producing motorcycles inside China. In country manufacturing would reduce costs allowing greater market penetration but at greater risk of counterfeit
Based on current issues of Honda, Honda Canada announced that it will export vehicles to Europe for the first time. They stated that Honda’s decision to build it’s the next generation of EU-destined CR-Vs in Canada is a result of the Historic free trade agreement we reached in EU, which provides preferential market access to a half-billion new customer. Under Canada-EU Agreement, the European Union will eliminate 10% tariff on the passenger of vehicles, providing Canada’s automakers with a competitive advantages in the EU market. The EU also eliminates – upon the agreement coming into effect – its tariffs on auto parts, which run as high as 4.5%. How Honda penetrate their business in China Honda entered the Chinese market in 1982 by cooperated
BMW soon realized that many threats impacted its market share in U.S. The Japanese auto manufacturers started building plants in the U.S. to deal with the increased U.S. demand at a lower cost than importing their cars. BMW's U.S. export situation was made even worse by the appreciation of German mark and additionally the higher German labor costs. As a result, the decision was made in 1991 to bui...
Hence production units for example the exports that take place in Europe and its Ukraine therefore they have competitive advantage with value into the technology. It gone through the acquisition by natural resource seeking for example Tata Company has invested in coal mines in different country and ownership advantage the company that enables them to successfully acquire established goal companies (KUMAR, 2008).Location advantage of Tata motors has the nature of the product and the services which the company requires to invest In plant or an office (Neelankavil and Rai,2009).In addition the Tata Company has a manufacturing with joint venture and Thornburg automotive gives which them a location advantage again in the south East Asia region. Internationalization advantage of Tata motors will help them in having better control over the manufacturing units as licensing option which are issues related to transfer of technology or technology theft. The advantages of own production for Tata company which they have done is introducing a new car called Nano an ultra low cost car
In a capitalistic country with a free market, foreign competition is expected. This is no exception for the automobile industry where America competes with its various rivals. Competition from elsewhere encompasses that from Italy, Germany, and of course, the renowned Japan. The Japanese vehicle industry is especially competitive; according to the Automotive News Data Center, five out of the ten best selling vehicles of the year are Japanese vehicles. This data applies to the U.S. market over the first 9 months of the year. Expectedly, the automobile industry is an important and significant market. Motor vehicles are a major form of transportation as many people in the U.S. own at least one car.
Investing or venturing into the international market involves critical analysis of the internal and external environment in which the company operates. Usually, a company will decide to venture internationally due to a saturated market or fierce competition in the current country of operation. The demand for a company’s products may have diminished as a result of an economic crisis thus the company will target a foreign market to sustain its sales. In other words, the firms expand internationally to seek new customers for its products. For example, the current Euro zone crisis led to low demand in Europe and many companies extended their businesses to emerging markets where demand was high. A company may also venture in the international market to enhance the cost-effectiveness of its operations especially for manufacturing companies that will benefit from low costs of production in developing world. Global expansion is a long term project as it involves demanding logistics to be successful. Thorough research must be undertaken to ensure that the expansion will create value for share...
This paper examines the expansion of General Motors overseas in its various phases, as well as triggers for internationalization and the problems faced during the process. The paper also considers what benefits have been achieved through international growth, and how the company can be classified with regards to Bartlett and Ghosal’s 4 typologies. Finally, the paper discusses the concept of a “world car,” meeting the demands of customers across the globe.
foreign cars in to Japan and even then they are so heavily taxed that the
...ations in host countries. Some problems that BMW face is going global into the Asian market for example china does not permit BMW to sell its products directly to its public it must go through government organisation for distribution. It also wants BMW to manufacture at least 80% of its parts in China, which is not possible as they don’t have a plant in China. And in India the tariff is too high, which makes it hard for BMW to import painted body into the country. According to India’s regulation BMW is not allowed to import more value than they are exporting.
BMW having high market share in European and U.S luxury car markets, started facing issues with launch product qualities and also facing a fierce competition from Japanese producers. Currently the market share was still stable but the rigorous growth of Japanese producers would affect BMW in future. These Japanese competitors had set higher standards of conformance.
Honda, like other automotive companies, also came to the conclusion of firming a joint venture. At the moment, Honda was already famous for motorcycles in UK, but it was less well known in terms of the automobiles. While Honda’s cars enjoyed reputation for good quality and durability, the import restrictions limited its success it the European market. However, the European market was essential for the company’s global expansion. With the joint venture, Honda could avoid the restrictions on the import quota by assembling cars locally, because these cars would be considered locally produced. Moreover, a local partner could assumedly offer a better insight of the market.
As Tata Motors is an automobile company, the raw materials required in production of a car or a vehicle include aluminium, copper, platinum, palladium, rhodium, steel and zinc. The prices for these materials have been increasing in the recent years. An increase in price of input materials could severely impact its profitability. Additionally, increases in fuel costs also pose a significant challenge to automobile manufacturers worldwide, especially in the commercial and premium vehicle segments where increased fuel prices have an impact on
Honda- focused differentiation, medium pricing, breadth of product line is high. Strengths are quality, reliability, overall value, and styling.
China continues to be the largest car market in the world ever since it overtook the U.S. in 2009. In tandem with the explosive sales growth in the auto sector, the country’s local car plates grew by c.150% between 2004 to 2015.
Due to the high market share and high barrier of entry, Honda and Ford have an oligopolistic relationship within the SUV market. These two companies tend to have similar prices against any other